The U.S. Supreme Court has bowed out of a long-running dispute over a DVD descrambling utility, dealing a preliminary defeat to Hollywood studios and electronics makers. Justice Sandra Day O'Connor placed a ruling by the California Supreme Court on hold last week, but rescinded her emergency stay on Friday.

O'Connor's decision came in response to court papers filed by lawyers for the defendant, Matthew Pavlovich, late Thursday. The effect is that Pavlovich is no longer barred from distributing the DeCSS descrambling utility by a court order, but he could be sued again if he decides to do so.

"The entertainment companies need to stop pretending that DeCSS is a secret," said Cindy Cohn, legal director for the Electronic Frontier Foundation, which is assisting Pavlovich. "Justice O'Connor correctly saw that there was no need for emergency relief to keep DeCSS a secret. It doesn't pass the giggle test."

An organization of movie studios and consumer electronics makers filed the lawsuit in 1999 against scores of people, including Pavlovich, who posted DeCSS. The DVD Copy Control Association's (DVDCCA) suit alleged violations of California's trade secret laws, and a state judge granted an injunction against the defendants.

But the California Supreme Court, in a split 4-3 decision last November, ruled that Pavlovich was a resident of Texas with no substantial contact with California who could not be sued in that state.